1968 magazine article shows how control of gold is main mechanism of imperial power

by Chris Powell, GATA.orgDear Friend of GATA and Gold: Thanks to GATA’s friend D.H. for calling attention to an article, “The Sieve of Gold,” from the May 1968 edition of the late magazine Ramparts — http://en.wikipedia.org/wiki/Ramparts_%28magazine%29 — which describes the longstanding U.S. government policy to push gold out of the international financial system in favor of the U.S. dollar; the increasing recognition by other nations that this constituted imperialism and made the dollar in effect a tax on the world; the collapse of the London Gold Pool; and the underlying cause of the enormous stress on the world financial system at that time, the Vietnam War. The author of the article, Michael Hudson, who recently had been an analyst for Chase Manhattan Bank and now is professor of economics at the University of Missouri at Kansas City, writes: “America’s desire to see gold eliminated from the world’s monetary system is understandable. It had used gold as a lever with which to exercise world power, not only to purchase foreign businesses but also to finance its overseas Cold War operations. Gold, America perceived, was power; as long as gold was the basis of the world monetary system, power followed it. Therefore, when its gold stockpile was depleted, America naturally wanted to transform the monetary system in such a way as to phase gold out, thereby preventing any other nation from using the power it provides — especially in view of the fact that the major potential gold-bloc nations are the Soviet Union, South Africa, and France.” Hudson’s biographical entry at Wikipedia shows that in the nearly five decades since 1968 he has done much work elaborating on the imperialism of the dollar system: http://en.wikipedia.org/wiki/Michael_Hudson_%28economist%29 While the London Gold Pool is no more, it has been replaced by the far more sophisticated U.S.-backed gold price suppression system of gold leasing by Western central banks and high-frequency trading by their bullion bank agents in the gold market. The U.S. national strategy, the defense of the dollar as the imperial currency controlling the world, remains unchanged. GATA’s own summary of that strategy and some of the developments in its implementation since 1968 is posted here: http://www.gata.org/node/14839 Hudson’s “The Sieve of Gold” has been posted in PDF format at GATA’s Internet site here: http://www.gata.org/files/RampartsMay1968-SieveOfGold.pdf